Drakes Bay Oyster Co. appears ready to wind down operations

OAKLAND -- After 19 months of legal fights the Drakes Bay Oyster Co. appears ready to give up its battle to remain open.

In federal court Monday in Oakland, an attorney representing the oyster operation said he was negotiating a settlement with the federal government. The discussions likely revolve around how operations would cease, but exact details were not revealed in court.

"We are still in settlement discussions," said Drakes attorney Larry Bazel.

Department of Justice lawyer Stephen Macfarlane said as soon as the U.S. Supreme Court rejected hearing the case last Monday he was in touch with the oyster company.

"We notified the plaintiff in writing last Monday that it is no longer authorized to remain on site in Drakes Estero and that it should wind down operations promptly," he told U.S. District Court Judge Yvonne Gonzalez Rogers on Monday. "We haven't reached an agreement, but we are still talking and there is a chance for movement here."

The sides agreed to a settlement conference in early August to come up with an agreement for how Drakes Bay would leave.

Bazel did note that Drakes Bay's permit with the federal government stipulates a reasonable time to remove equipment.

The Supreme Court's refusal to hear Drakes appeal was the last legal maneuver as the oyster farm attempted to remain open in the face of a federal government order to shut down.

Owner Kevin Lunny's team believed the Supreme Court might have wanted to hear the case to resolve split rulings the U.S. court of appeals system had issued on interpretations of federal law. The splits in this case were on jurisdiction to review agency actions for abuse of discretion and could have set a new clear precedent.

But the Supreme Court apparently did not see enough legal merit in the case to take it on.

The Drakes Bay closure order came on Nov. 29, 2012, when Ken Salazar, the interior secretary at the time, announced he would allow a 40-year lease -- originally negotiated with the Johnson Oyster Co. in 1972 and taken on by Drakes Bay -- to expire. In 1972, the federal government bought the land from Johnson for $79,200 and provided the lease. Lunny took over the lease in 2004. Salazar wrote in his decision that Lunny was explicitly informed "no new permit will be issued" after the 2012 expiration date.

The park service wants to return the area to wilderness. But Lunny didn't take the decision sitting down and launched a legal counterattack, buoyed by community support in West Marin.

But in February 2012, it was Judge Rogers who rejected a preliminary injunction to halt the federally ordered closure of the oyster operation in the Point Reyes National Seashore.

The 9th Circuit court agreed to hear the case and review Rogers' decision. In September 2013, a three-judge panel of the 9th circuit ruled it lacked jurisdiction to review Salazar's discretionary decision not to issue a new operational permit for Drakes Bay.

But in that ruling 9th Circuit Judge Paul Watford wrote in a dissenting opinion that Lunny's request for an injunction should have been granted. That provided the oyster company's supporters hope the high court might reconsider that 2-1 ruling, but that didn't happen.

Until legal issues are cleared up, the Inverness oyster farm remains open. But it appears its days are now numbered.

"This has been a hard fought case," Rogers told both parties Monday. "My job now is to keep pushing you until there is a settlement." ------ (c)2014 The Marin Independent Journal (Novato, Calif.) Visit The Marin Independent Journal (Novato, Calif.) at www.marinij.com